Forum to propose new Section 13 over secure tenancies rents

WORK on the controversial issue of setting rents will go ahead separately from reporting on other tenancy issues, NFU Scotland president Nigel Miller has said.

The Tenant Farming Forum (TFF) – whose members include the Scottish Tenant Farmers Association and NFU Scotland – met Cabinet Secretary Richard Lochhead last week when they set a timetable of 18 months for coming up with suggested improvements in the sector.

But the controversial Section 13 of the 2003 Agricultural Holdings (Scotland) Act, which concerns how rents for secure tenancies are set, is a stumbling block.

And the TFF plans to review it separately and urgently to come up with a fairer system and suggest how the law should be changed.

Speaking to TheSouthern, Stow farmer Mr Miller explained: “It’s pretty fundamental to how rent reviews are assessed.

“The latest ruling suggests that what should take primacy is free market comparables. But there’s a concern about how that would work and how it might add impetus to rent increases.”

The aim is to come up with a suggested new Section 13 by October in time for the Scottish Government’s next legislative programme.

Mr Miller continued: “We are still trying to get a process fixed up with Government.

“The idea is to try and fastrack a review and come up with proposals which hopefully would be clear and allow a formula to be used that is transparent and simple to operate and reflects the earning capacity of the land so you come up with a sustainable rent.

“The key thing about long-term rents is that they reflect the earning capacity of the holding. Some people believe comparables are key to delivering that, others would suggest a formula that looks at the productive capacity of the land or margins of the business would be a better way of setting a rent.”

Other issues TFF will provide reports on within the 18-month framework include equipment, repair-renewal, investment and improvement, waygo, diversification and assignation and successions.

Meanwhile the union will be holding meetings across Scotland to discuss issues such as investment in holdings, waygo and a satisfactory dispute resolution process with tenant and landlord members.